Sovereign Debt Restructurings in Grenada:
Written by George Grant on July 25, 2017
CAUSES, PROCESSES, OUTCOMES, AND LESSONS LEARNED
July 24, 2017
Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
This paper documents the two debt restructurings that Grenada undertook in 2004–06 and 2013–15.Both restructurings emerged as a consequence of weak fiscal and debt situations, whichbecame unsustainable soon after external shocks hit the island economy. The two restructurings provided liquidity relief, with the second one involving a principal haircut. However, the first restructuring was not able to secure long-term debt sustainability. Grenada’s restructuring experience shows the importance of (1) establishing appropriate debt restructuring objectives; (2) committing to policy reforms and maintaining ownership of the restructuring goals; and (3) engaging closely and having clear communications with creditors.
Series: Working Paper No. 17/171
Publication Date: July 24, 2017
Stock No: WPIEA2017171
Price: $18.00 (Academic Rate:$18.00)